Content
About the statistics
Definitions
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Name and topic
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Name: New multi-dwellings house price index (discontinued)
Topic: Prices and price indices
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Responsible division
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Division for Construction and Service
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Definitions of the main concepts and variables
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The price used in the index is the price that the investor (final owner) has to pay for a dwelling in a new multi-dwelling house excluding site costs. Costs such as connection to road, water and sewer services, duties and administrative fees, interest on building loans and VAT are included. Prices are based on loan applications and are estimates of the final costs, not the actual final costs. We have compared the estimates and the final costs and have only found insignificant differences.
Time of measurement: The index is comprised of multi-dwelling housing projects for which the Norwegian State Housing Bank has granted loans during the six-month reference period. Loans are normally granted before or when the building commences.
Utility floor space is the floor area measured within the outer walls, as defined in Norwegian Standard NS 3940 Area and volume calculations of buildings.
Buildings classified as having " energy economising qualities " have to meet the goal of more than 20 per cent lower energy consumption than currently set by the building regulations. Measures to achieve lower energy consumption can be insulation, balanced ventilation and thermal pump.
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Standard classifications
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Two different types of buildings are identified in the index:
Small houses: semi-detached houses, row houses, linked houses, houses with 3 or 4 dwellings and apartment buildings with two storeys
Blocks of flats: Apartment buildings with 3 or more storeys.
From the second half of 2007 Statistics Norway has only publish the total index for new multi-dwellings houses. From this point it is not divided between small houses and blocks of flat.
Norway is divided into three different price zones:
- Oslo and the municipality of Bærum
- The major cities of Stavanger, Bergen and Trondheim, and the county of Akershus excluding Bærum
- The rest of the country
Administrative information
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Regional level
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National level
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Frequency and timeliness
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Biannual. The index is usually published about four weeks after the end of the six-month reference period.
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International reporting
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Not relevant
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Microdata
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The data are stored as text files on UNIX.
Background
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Background and purpose
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The index measures changes in prices of new multi-dwelling houses. The index has been published since 2005, with figures dating back to the first half of 2000.
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Users and applications
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The price index is used to analyse and monitor price/cost changes and is also used in the national accounts. The index is used by institutions and people with an interest in the housing market, including research and financial institutions and the media.
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Coherence with other statistics
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The price index for detached houses is published quarterly. This index measures the price at the time of completion. The price index for new detached houses does not include costs such as connection to road, water and sewer services, duties and administrative fees and interest on building loans.
The price index for multi-dwelling houses also differs from the construction cost index for residential buildings in that it takes into account changes in productivity and profit margins.
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Legal authority
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The Statistics Act, sections 2-1 and 3-2
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EEA reference
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Council regulation (EU) No 1165/98 of 19 May 1998 concerning short-term statistics
Production
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Population
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The population consists of dwelling houses, except detached houses and residences for communtities, in which building work commenced during the six-month reference period.
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Data sources and sampling
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Statistics Norway receives data from the Norwegian State Housing Bank. The data are taken from loan applications from builders of multi-dwelling houses.
All multi-dwelling houses built with funding from the Norwegian State Housing Bank.
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Collection of data, editing and estimations
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The Housing Bank reports data to Statistics Norway every quarter. The data are sent via e-mail in SAS format.
Multi-dwelling houses with a particularly low or high price per square metre are not included in the index.
In 2007 the square metre price requirements are as follows:
Small houses:
Price per square metre between NOK 4 000 and NOK 30 000
Blocks of flats:
Price per square metre between NOK 4 000 and NOK 40 000
The index is calculated using the hedonic method with multiple regression techniques. The variables used in the regression analysis correspond to characteristics that influence the price of multi-dwelling houses. These are: utility floor space, geographic location, share of communal area, share of other quality characteristics and the number of dwellings in the project. Observations from the last five years are used in the regression analysis to obtain confident and stable estimates of the hedonic price function. The price elasticities are assumed to be constant for that period of time.
Sub-indices for the two above-mentioned housing types are calculated using the hedonic method and weighted into the main index. The weights are the proportion of the number of dwellings built per housing type, taken from Statistics Norway's Building statistics ("building work started") during the last three years.
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Confidentiality
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Not relevant
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Comparability over time and space
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The index dates back to the first half of 2000. The same method of calculation has been used in the entire period. In connection with the publishing of numbers for first quarter of 2006, the index calculation method and the time series was revised.
From the second half of 2007 Statistics Norway has only publish the total index for new multi-dwellings houses.
Accuracy and reliability
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Sources of error and uncertainty
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Errors can occur when the data are registered and processed by the data suppliers (the Norwegian State Housing Bank). However, automatic controls ensure that projects with particularly high or low prices per square metre are not included in the calculation of the index.
The sample only consists of houses financed by loans from the Norwegian State Housing Bank. This may lead to skewness with regard to both the characteristics of the buildings and the geographical location. We have examined the data and found that the largest cities are slightly underrepresented. Overall the geographical spreading is satisfactory. The data cover about 50 per cent of the population.
Housing projects funded by the Norwegian State Housing Bank must meet certain criteria with regard to costs, construction and characteristics. These conditions are, to some extent, the result of political decisions and are subject to changes. This may lead to sample skewness, as the buildings included in the index are not necessarily representative for all new multi-dwelling houses.